WASHINGTON, D.C. – Senator John Kerry (D-Mass.) today spoke from the floor of the United States Senate to address the current debate surrounding the Chinese currency bill.

“China is an important partner of the United States in a lot of ways. It's also a major investor in the United States,” said Sen. Kerry. “So I don't think that we're here to rupture that relationship. I think we're here to send a message to the Chinese about the urgent need to repair it. We want a mutually beneficial partnership, an equitable partner that will pay dividends for both countries and I believe if we listen to each other and work in good faith we can make that happen, and we can enter into a better framework of cooperation that inures to the benefit and the stability and the leadership demands of both of our countries.”

The full text of his speech, as delivered, is below:

Mr. President, I yield myself such time as I’ll use under the one hour. I won't use all of that by any means. Mr. President, this is obviously an issue that's more complicated than the debate here may have indicated at all moments, at least. And I think that there are complicated and long-standing frustrations that have built up in a lot of senators and a lot of people in America that bring us here to this moment on the floor.

As chairman of the Foreign Relations Committee, I have a reluctance to see us engage in an effort that I think can put other efforts at risk in certain ways. But on the other hand, I have voted to allow and help this legislation to reach the point of post-cloture because I think it's an important debate because I think China needs to carefully think about and process the substance of what people are saying here on the floor of the United States Senate.

This is a very complicated relationship with enormous interests on both sides for us to avoid confrontation in a lot of different ways, a lot of different kinds of confrontation. Trade, physical confrontation in the South China Sea and the straits and elsewhere, confrontations over human rights in Tibet and other issues. There are a lot of issues at play. But with respect to the trade issue, China has a huge interest in the United States of America being able to export more effectively to China. China has an interest in its middle class growing in its purchasing power and expressing that purchasing power through consumption.

One of the things China needs is its own higher level of domestic consumption. It's saving too much. And one of the reasons it saves too much is it doesn't have a safety net structure of any kind really. So people do save. That’s the nature of life there. But at the same time China, I think, is seeing a slowdown of its own economy now. And one of the reasons for the slowdown in China's economy is the fact that we have had a slowdown in our economy and in our ability to consume the goods brought in from China, so it all is interconnected. China's also our biggest banker, and China is critical to our ability to deal with our current economic challenge in many ways, and Europe's, I might add, both Europe and the United States would benefit significantly with a new trade relationship with China. And that's what I want to talk about for a moment.

I believe in trade. I have supported trade here. I don't believe in unequal trade. I don't believe in unfair trade. I believe in enforcing the agreements we have. If you look at NAFTA, for instance, NAFTA had side agreements, side agreements on the environment, side agreements on labor standards, and they were never enforced. And people have a right to be angry if they see an agreement that's made and then parts of it are enforced, parts of it are not, and they see their job go overseas, whether it's in North Carolina or Georgia or Massachusetts or Ohio or any other place in our country. So I think it's important to have trade that's fair and sensible. You're not going to grow your economy trading with yourself. No way. Particularly if your overall population growth isn't growing that fast and you're a mature economy, economics just doesn't work that way. You need you are in you need newer markets and other places to expand. So I think that it's important for us to recognize that the world's trading system only works if the participants treat each other fairly.

Over the last decade, our national debate on the costs and benefits of trade has intensified, and frankly the uneasy alliance, the uneasy -- I think I would call it sort of uneasy consensus that had been created from the 1980's forward with respect to trade is being frayed right now, is being frayed for understandable and clearly definable reasons. The American worker is not seeing their wages go up. There are a lot of reasons for that. The unfairness of our tax code, the inability of people in America today to be able to bargain the way they used to and the lack of an NLRB and a Court that upholds the rights of labor to be able to negotiate, a whole bunch of reasons why people are disadvantaged today. And one of them is the fact that you have this unfair competition. So in order to keep the consensus which allows Americans to say yeah, trade is a good thing, it's got to be a good thing, and to be a good thing, it's got to be fair and it's got to result in people's lives being improved by it, meaning their wages go up, their jobs can get better, their opportunities are greater.

Everything has been working in the opposite direction, and I think that's why so many of our colleagues feel a responsibility to come to the floor on this legislation and make sure that China and others hear from the American people loudly and clearly. We did this before on a vote that we took on currency legislation back in 2005. I think China heard us then, and China began slowly to allow the value of its currency to begin to fluctuate rather than keeping it pegged tightly to the dollar. China's taken measures. China's -- in fairness, China's currency has appreciated over the course of the last few years. Some argue exactly how much, somewhere in the vicinity of 27%, maybe 7% the last year, but it's not fast enough. It's still not fair enough. And the fact is that there are other Chinese trade tactics that contribute to our increasing trade deficit with china, not just currency.

Unfortunately, our efforts through multilateral institutions, nobody can point a finger at the United States and suggest that we haven't played by the rules or that we haven't gone to the global institutions in order to try to resolve these differences. We have gone to the World Trade Organization, and we have won sort of step by step, slowly but slowly. But if your tactic is to just keep in this highly mercantilistic focus of China to keep on taking advantage of everything you can and you get a little nibble here and there at the W.T.O., a little nibble over there, that's really just an inconvenience on the road to a kind of trade domination that is bad for everybody. So that's why I’m here today, that's why I have voted for this legislation to come to the floor to have this debate.

This debate is an imperfect stand-in for the broader discussion that we need to have about our economic relationship with China. The truth is that our bilateral relationship is both filled with promise and plagued by complex challenges that we have to overcome for the good of both countries. The Chinese market is a huge and growing opportunity for American firms, obviously, and despite the hurdles to entry -- and there are hurdles -- China is still our fastest growing export market today. People better think about this as we go forward. I am convinced that the key to America pulling itself out of this economic challenge we're in today and the key to Europe pulling itself out is for the United States and Europe to actually work out almost formally a new and better relationship with respect to trade with China as well as with the other fast-developing countries -- Mexico, South Korea, Brazil, India. Because if those societies will allow us adequate entry to market, and if those societies will purchase more from Europe and the United States, then we will export more, manufacture more, come out of the economic doldrums, and that reverberates to China's benefit also because their investments in the United States become more secure because our debt goes down because we have a stronger economy and because we're watching more in return from them. What goes around comes around.

So my hope is that we can agree on fair terms and conditions for trade with these rising powers, and if we do, we will create jobs. It's the fastest way we have to create jobs and pull out of our economic doldrums today. The simplest, fastest, most obvious way to do this is to be able to access those other markets rapidly with American goods and begin to restore confidence to the marketplace so that people believe they will get a larger return on investment and begin to reinvest in job creation and in the marketplace. The current trade model that we're operating under with massive U.S. trade deficits, enormous Chinese trade surpluses is not only unfair, it's unsustainable. So we have got to rebalance that relationship. China's own leaders need to understand that their country's long-term economic health absolutely cannot rest on a subsidized foundation of subsidized exports fueled by an indebted American consumer and the credit card of the American consumer. That is a deathly unvirtuous to use our former chairman of the fed's comments about virtuous and unvirtuous cycles -- it's about as unvirtuous as you could get in that economic relationship.

Now, conflict, in my judgment, is not the best way to resolve our tensions, but making clear how we feel and what we think the reality is and what's important in our relationship is critical. Some of our colleagues have come to the floor to argue that our two countries are already in a trade war. Others have come to the floor to say that this bill is going to trigger one. Mr. President, I don't agree with either of you. I don't think either one of those views are correct. If we were in a real trade war with our largest lender, let me tell you they would be doing a heck of a lot more damage than the misalignment of currency is currently doing to us. And the specific remedy proposed in this legislation is neither as dramatic nor as offensive as some people have said. This is a pretty carefully structured piece of legislation, and I think the language has been chosen in a thoughtful way, and I think the remedies that are available under this bill are not as dramatic as some would suggest. It doesn't propose raising tariffs on all Chinese goods. It only proposes increasing tariffs on those Chinese goods that receive an unfair advantage from an undervalued currency and then compete with American-made goods here in the U.S. It's a pretty limited and targeted message, and that's within our rights. That's within our rights. And if the yuan is properly valued, that will simply not be necessary. That's China's decision, China's choice.

I would much prefer a negotiated, multilateral solution, as I described, involving this new relationship, the new trade relationship, if you will, on a global basis which I think would send an extraordinary message to a beleaguered Europe, where Greece, as we all know, is basically fundamentally insolvent, needing some kind of a managed structured transition hopefully that avoids a greater crisis in Spain and contagion in their banking system which clearly needs recapitalization, clearly needs more than $440 billion that was put on the table, clearly needs some kind of a rescue fund with some very tight kinds of requirements, not dissimilar to what we did in the united states in 2008, 2009 out of sheer necessity. My hope is they will do that, but nothing would do more to send a message of confidence about the future of job growth than to have this new trade understanding and relationship where responsible partners are behaving responsibly and accepting responsibility for the global marketplace that we all operate in. Not just exploit it but support it. Protect it, nurture it.

Beyond the currency, there are many other sources of tension in our economic relationship, and they need to be resolved, Mr. President. China does not protect our intellectual property in its market adequately, and that's almost a euphemism. The violations of intellectual property rights, the outright theft on some streets and communities within China, billions of dollars of American design and -- designed and marketed and developed property is shocking, and in addition to that, China imposes artificial regulatory barriers to the entry of many of our goods. It fails to crack down on cyber-attacks, and it has executed a thinly veiled effort to appropriate key foreign technologies. On each of these issues and others, we have been going to the W.T.O., we have been bringing cases and we have been winning those cases, and as I have said, that is not a substitute for this larger fix in the relationship that is critical. I believe that overcoming market access challenges are actually where we ought to be focusing our efforts in China, and also in the other large fast-growing markets, and that, as I have said several times, is really the answer, the quick answer, if you will. We can develop goods, we can invest in companies here, but if we can't sell the goods to more than ourselves, we have got some serious limits on us, and I think it's important for us to be fighting for that market access.

I believe that to increase our exports, we're going to have to increase our competitiveness here at home and we're going to have to convince our partners to lower their tariffs, remove discriminatory regulatory restrictions on our exporters, protect intellectual property, use scientific standards as the basis for allowing our agricultural goods to enter and recognize that trade in services is becoming as important to the modern economy as trade in goods. And we need to make the case that doing all of these things is not to the advantage of one country or another. It’s to all of our shared advantage because of the nature of the global marketplace that we live in. Countries like China, India and Brazil are stakeholders whether they want to admit it or not publicly, they are stakeholders in the West's economic success. They need access to our consumers. They need access to our investors. They want to make deals over here. They want to have joint ventures. They want to own companies. And their businesses and citizens will benefit from strong, sustainable growth in the world's largest economies.

China is an important partner of the United States in a lot of ways. It's also a major investor in the United States. So I don't think that we're here to rupture that relationship. I think we're here to send a message to the Chinese about the urgent need to repair it. We want a mutually beneficial partnership, an equitable partner that will pay dividends for both countries and I believe if we listen to each other and work in good faith we can make that happen, and we can enter into a better framework of cooperation that inures to the benefit and the stability and the leadership demands of both of our countries. We both sit on the security council of the United Nations. We both have remarkable responsibilities through our economic power. We are still the largest economy on the face of this planet, maybe three times larger than China still, even as China is growing. China will surpass us, and with that reality of where China stands today economically comes a major responsibility. No country has exercised that responsibility through all of the last century and into this century, I think, with greater sense of purpose and responsibility than the United States. And I think hopefully China will embrace the notion that its new economic power brings with it that same shared responsibility, and I hope we can engage in the creation of that kind of mutually beneficial relationship. Mr. President, I reserve the balance of my time and yield the floor.